Argentina's Dairy Industry: An Overview
Argentina stands as a significant contributor to the global dairy market, bolstered by a robust herd of approximately 1.6 million dairy cattle. By 2023, the nation achieves an impressive annual milk production of around 10.5 billion liters, establishing itself as a key supplier within the international dairy sector.
Production and Processing
Argentina boasts a sophisticated dairy processing infrastructure capable of handling approximately 9 billion liters of milk annually. The country is particularly noted for its cheese production, yielding about 500,000 metric tons each year. Additionally, it produces 150,000 metric tons of milk powder and whey, underscoring its strength in dairy processing capabilities.
Key Enterprises and Dairy Farms
Prominent entities in the Argentine dairy sector include La Serenísima (Mastellone Hermanos S.A.), Saputo Inc., and Williner. Leading dairy farms like Tambos La Unión and Estancia La Nueva play crucial roles in national milk production.
Exports and Imports
Argentina exports approximately 3.5 billion liters of dairy products annually, comprising liquid milk, cheese, and milk powder. The completion of the EU-Mercosur trade deal is expected to significantly enhance trade relations, with exports projected to rise by 50%. However, imports from Germany have been halted due to concerns regarding Foot-and-Mouth disease.
Significant Market Events
The industry has faced challenges, including board changes at Saputo Inc. and an anticipated 7% decline in milk output for 2024. Despite these challenges, companies like Milkaut are investing in modernizing and expanding their plants. The recent removal of export taxes has been pivotal in enhancing the prospects for the local dairy industry.
Outlook and Trends
Despite challenges such as rising production costs and climate disruptions, the sector is poised for growth, with innovations like robotic dairy farming in Tacural, Santa Fe. Reports indicate a nearly 16% increase in milk production year-on-year as of March 2025, with a projected annual growth rate of 6%.
Challenges and Innovations
Financial crises pose significant challenges, with a leading dairy company in Santa Fe facing a debt of over 5.42 billion pesos. The role of cooperatives, advocated by CAPROLECOBA, emphasizes the need to remove export duties to boost income and investment. Meanwhile, organic dairy production is gaining traction, exemplified by an organic dairy in General Rodríguez supplying milk to Nestlé.
Cultural and Consumer Trends
Tandil celebrated its Banquete Típico cheese's recognition as the best in the semi-hard cheese category, while a new ice cream flavor, chocolate and almonds, gained popularity.
Regional Support
Tucumán has extended tax benefits for its dairy sector until 2035, strengthening local production. Despite inflation pressures and economic challenges, the industry is experiencing a resurgence, with a 10.9% increase in national dairy output in the first quarter of 2025, further consolidating with a 12% increase in the first half of the year.
Conclusion
Argentina's dairy industry is set to achieve record production levels in 2025, with projections suggesting an output between 11.4 and 11.5 billion liters. However, the sector faces a downturn as consumer spending shrinks, with a 6% contraction in dairy product sales reported in July 2025 compared to the previous year. The association of small and medium-sized dairy companies in Argentina, APYMEL, is advocating for a reduction in milk prices to address the imbalance. Despite facing significant challenges, Argentina remains a crucial global dairy supplier, with continued efforts to enhance sustainability and market access, particularly through strategic international engagements. The price paid to dairy producers is expected to remain stable during the spring, approximately aligning with historical averages. Between January and July of 2025, dairy production grew by 11% compared to the previous year, driven by favorable conditions and increased supply chain mobilization.
In Argentina, despite widespread flooding, the dairy sector shows resilience with favorable conditions and promising forecasts. In the Western Basin of Buenos Aires, dairy production has shown resilience against climatic adversities. Recovery has been robust, and the sector believes that conditions are in place to maintain the levels recorded. Despite excess rainfall causing waterlogging in more than three million hectares, good forage availability and favorable relative prices compared to corn and soy are reported.
Modified: 2025/10/01